The Nigerian National Petroleum Corporation (NNPC), as part of measures to improve transparency and accountability in its operations, has published its audited financial statements online for 2018.
This is viewed as a reaction to the criticism that has been on the government-owned oil firm, for years of conducting the country’s oil business in secret by only publishing unaudited financial reports. The audited financial statements for NNPC and its subsidiaries, which were published on the company’s website yesterday, were signed by the Group Managing director/Chief Executive Officer of NNPC and the Chief Executives of the various subsidiaries.
The NNPC also published the audited accounts of its 20 subsidiaries and business divisions for the first time.
While acknowledging the release of the audited financial statement, the Executive Secretary Nigeria Extractive Industry Transparency Initiative (NEITI), Waziri Adio said, “Having such disclosures is good for transparency and accountability. I congratulate Mele Kyari and his team and urge them to make this a regular practice and in open data format.”
👇Link to the 2018 audited financial statements of @NNPCgroup. Having such disclosures is good for transparency and accountability. I congratulate @MKKyari and his team and urge them to make this a regular practice and in open data format. @nigeriaeiti https://t.co/0k9MHCRFjK
— Waziri Adio (@Waziriadio) June 14, 2020
The audited financial statements focused more on the subsidiaries of the NNPC group as there was no consolidated financial statement.
As part of the highlights of the audited financial statement, the National Petroleum Investment Management Services (NAPIMS), its most profitable subsidiary according to the statements, reported a revenue of N5.04 trillion in 2018 and a profit of N1.01 trillion as against a loss of N1.65 trillion that was recorded in 2017.
The nation’s 3 refineries recorded combined losses of N154 billion with the Kaduna Refinery recording zero revenue for 2018. The Nigerian Petroleum Development Company (NPDC), its oil production subsidiary made an after-tax profit of N179 billion for 2018 as against the N157 billion that was made in 2017.
The Pipeline Product Marketing Company (PPMC), its supply and refined petroleum products marketing subsidiary, reported a revenue of N29.5 billion in 2018 as against the N113 billion that was achieved in 2017. It reported a profit after tax of N9.3 billion in 2018 as against a loss of N27 billion that was recorded in 2017.
Customers to pay for metering through cost of tariff – NERC
The Commissioner used the event to address issues regarding new tariff and metering.
Commissioner for the Nigerian Electricity Regulatory Commission (NERC), Mr. Nathan Rogers Shatti, has said that Nigerian electricity customers won’t have to pay for meters in the new guidelines, as it would be covered through tariff costs, and customers who had paid for their own meters would be compensated.
This was disclosed by the electricity regulator in a virtual session with customers and stakeholders of Nigerian electricity on Wednesday evening.
The Commissioner used the event to educate customers on the new service-based tariff and other complaints regarding their meters. “Service based tariff is important. It would be applicable for those who are getting the services; let them pay for it.
“There would be a new mechanism for people who used their money to buy their own meters. There have been delays in the implementation; all those who paid for their own meters will be compensated.”
He added that in the future, the cost of paying for the meters would be added to the new service costs, saying, “Metering, going forward won’t be paid for, but through the costs of tariff.”
He also explained how customers who had paid for their own meters would be compensated. “Their costs would be computed and they would be compensated overtime,” he said.
Nairametrics reported last month that President Muhammadu Buhari had approved the much-anticipated electricity tariff increase effective from September 1st, 2020.
The Federal Government also said that only customers with a guaranteed minimum of 12 hours of electricity could have their tariffs adjusted under the new electricity tariff arrangement.
Government publishes plans to sell PHCN properties
The Federal Government through the Nigeria Electricity Liability Management Company ( NELMCO), announced plans to sell off real estate belonging to the defunct PHCN.
NELMCO disclosed earlier last week the first batch of properties to be sold, including older NEPA/PHCN offices, guest houses and other properties owned by PHCN before the Power Privatization scheme of 2013.
NELMCO, incorporated on August 21st, 2006 as a limited liability company was created during the electricity power sector reform with a very specialized role to play. NELMCO was designated to assume responsibility for all of the PHCN liabilities leading up to the November 1, 2013 handover of the companies. As well as the management of the non-core assets of the companies, prior to disposition of same.
One of the objectives of NELMCO is to “ sell, let, mortgage, dispose of, deal in any of the property or non-core assets of the company as may be expedient with a view to promoting its objects”.
In July, NELMCO Managing Director, Adebayo Fagbemi, disclosed during a visit by the Senate Committee on Power to Abuja Electricity Distribution Company head office, that the NELMCO would sell 216 former PHCN properties in phases.
NNPC extends crude oil swap contracts by 6 months
The swap deal with these companies supplies a huge portion of Nigeria’s petroleum products.
The Nigerian National Petroleum Corporation (NNPC) has announced a 6-months extension of its contracts with private oil firms to swap crude oil for fuel.
According to a media report from Reuters, the affected oil companies renegotiated the price agreement due to changes that were made in the prices of petrol in the country.
The initial 1-year oil swap contracts to exchange over 300,000 barrels of crude oil per day with 15 company groupings were due to expire in October 2020. The swap deal with these companies supplies a huge portion of Nigeria’s petroleum products which include fuel, diesel and jet fuel, as it has not been profitable for private oil companies to import fuel into the country.
As a result of this, the state oil giant, NNPC, has been the sole importer of fuel for quite a while.
Nairametrics, over a year ago reported that NNPC had contracted about 34 companies under a total of 15 groupings to carry out a swap deal for the supply of refined fuel in exchange of crude oil. This scheme was introduced in 2016 to replace the programme at that time which gulped trillions of naira in subsidy payments to importers and supplied about 90% of the fuel import requirements.
The Federal Government recently started the implementation of its deregulation policy with its stoppage of fixing prices and allowing market forces to determine the price of petrol. This decision will eliminate the subsidy payment by the Federal Government and allow private oil companies to invest in the downstream oil sector and restart the importation of fuel again.